Critical article on the lending experience at FC CE

He/she is basically saying there are too many defaults and that reminders to the borrowers have not been effective, plus FC have not paid back recovered money to the lender on time or, in one case, not yet, despite assurances to the contrary.  In addition, they haven't published statistics, despite promising to do so. So not very impressed with the credit ratings and the competence of FC. This German branch of FC was previously zencap. 


(I translate German for a living although this is just a summary).

Careful of using non-inclusive language there, nightmare. h**1997 could be a girl

Sorry, Miss.

Hi James

It will be nice to see a journalist shine a light on FC, something to look forward to. When you do perhaps you could post a copy on here so it can be seen by us tightwads who won't shell out for a peek through Ruperts paywall?

I think some of the anger follows from a failure to understand that there are differences between the treatment of personal and business loans.

RS and Zopa default personal loans after the fourth payment is missed, which I believe is an industry standard for personal lending. With RS this is invisible to the lender since a loan is fully repaid by the provision fund after the first late payment. The position with business loans is different, since an inappropriate default can lead to an otherwise viable, but temporarily troubled, business stopping trading.

RBS has been criticized for forcing businesses into administration following default when a less aggressive approach would have allowed the business to survive. FC will often work with an SME without defaulting loans if they can see a viable plan that could lead to a better outcome than a default followed by administration.

Property loans present another set of problems. FC has an unreliable IT system which fails if it is breathed on and cannot make unplanned payments. This has led to a promise that payments due from the most overdue loan will be paid as a lump sum eventually. Perhaps some of the most vociferous lenders do not understand the inevitability of delays in repayment of property loans. Defaulting these involves calling in the assets and starting a lengthy and costly sale process. If a development is not complete this could lead to significant losses. Assetz Capital have had some problem loans where, following a default, recovery has been a very protracted process. There is a widespread belief that property is a sound investment, but a failure to understand that it can also be illiquid, with loans not able to be repaid on demand. This needs to be made clearer as part of the Risk warning.

I no longer lend through FC because I am not impressed with many aspects of the company 

- Poor IT

- Poor customer Service

- Bots running wild and snapping up new loans in seconds

- A decline in the quality of loans leading to inadequate risk/reward

- Costly overseas expansion and large losses by the platform itself

Treatment of late loans has never been an issue
 

Mrclondon,

Just read this and nearly choked on my drink (a very nice Sauvignon as it happens). So you are not just very impressed, but VERY impressed at the outcomes of FC's recovery team's efforts?

Well all I can say is that you must be very, if not VERY easily impressed (or maybe a covert lobbyist and/or employee)!?

In my three year experience with FC they have consistently proved to be about as much use a chocolate frying pan with respect to recoveries - and that denigrates chocolate frying pans as at least in extremis you can eat them.

Unbelievable!!